The Grayscale Ethereum Trust (ETHE) is trading at nearly a 60% discount to the underlying value of its assets, with shares falling 93% from its June 2019 all-time high (ATH).<\/p>\n
There are many reasons behind the ongoing decline, but in recent weeks fears have grown that fallout from parent company Digital Currency Group\u2019s debt of approximately $1.675 billion to troubled crypto lender Genesis could impact Grayscale assets. <\/p>\n
YCharts data shows a 59.39% discount at the time of writing, a level the trust has traded at since at least Dec. 28.<\/p>\n Crypto Twitter influencer \u201cdb\u201d tweeted an image on Jan. 4 depicting the entire collection of Grayscale crypto-based trusts with statistics showing their respective premium.<\/p>\n Every Grayscale trust and their respective premium % pic.twitter.com\/TYQf5FmeXt<\/a><\/p>\n \u2014 db (@tier10k) January 3, 2023<\/a><\/p><\/blockquote>\n It showed most of Grayscale\u2019s trust funds are trading at a discount with Ethereum Classic Trust hit hardest, currently at a 77% discount, followed by Litecoin Trust at 65% and Bitcoin Cash Trust at 57%.<\/p>\n The Grayscale Bitcoin Trust (GBTC) is trading at a 45% discount.<\/p>\n Just two Grayscale Trusts are currently trading at a premium, the Filecoin Trust at 108% and the Chainlink Trust at 24%.<\/p>\n According to Grayscale\u2019s official website<\/a>, there are currently $3.7 billion worth of assets under the Grayscale Ethereum Trust (ETHE) pool collected from 31 million shares.<\/p>\n The Ether (ETH<\/a>) per share is around 0.0097 ETH, which is worth $11.77 USD, while the market price per share is $4.77 USD.<\/p>\n Grayscale\u2019s parent company, DCG, came under fire again this week when Cameron Winklevoss, the co-founder of cryptocurrency exchange Gemini, called out DCG CEO Barry Silbert in an open letter<\/a> on Twitter.<\/p>\n Related:<\/em><\/strong> <\/em><\/strong>Will Grayscale be the next FTX?<\/em><\/strong><\/a><\/p>\n Winkelvoss claimed DCG\u2019s company Genesis owes Gemini $900 million in funds lent to it as part of Gemini\u2019s Earn product that the two companies ran in partnership.<\/p>\n Digital assets research and analysis company Arcane Research suggested in a <\/a>Jan. 3 report<\/a> that the significant debt DCG and Genesis purportedly owe to Gemini could see DCG\u00a0initiate a Reg M distribution<\/a>,\u00a0which would allow holders of GBTC and ETHE positions to redeem them for the underlying assets at a 1:1 ratio.<\/p>\n This would be bad for crypto markets but good for ETHE shares. According to Arcane: \u201cA Reg M would cause a massive arbitrage strategy of selling crypto spot versus buying GrayscaleTrust shares. If this scenario plays out, crypto markets could face further downside.\u201d<\/p>\n Winklevoss has been vocal on the alleged DCG liquidity issues, previously tweeting<\/a> an update in December that global investment bank Houlihan Lokey had presented a plan on behalf of the Creditor Committee to provide a pathway for the recovery of assets<\/a>.<\/p>\n<\/div>\n![\"\"](\"https:\/\/s3.cointelegraph.com\/uploads\/2023-01\/bffc832c-6617-483a-b3e2-d44ce71bdca6.png\" "\\"\\"")
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